Managing corporate reputation
Everything your company does is observed through the filter of corporate reputation. And a company’s corporate social responsibility activity – and inactivity – has an enormous impact on reputation. In a study TNS conducted in the US in 2005, we saw changes in investors’ evaluations of the 30 companies comprising the Dow Jones Industrial Average (DJIA), proving that corporate reputation influenced the value of those companies and the share price of their stocks even as far back as 2001. So how do you get your company ready to measure and manage corporate reputation?
1. Recognise that your corporate reputation is already impacting your business
Corporate reputation is either a halo or a shadow, depending on how strong or weak it is. Many companies do not recognise how the issues they deal with are often symptoms of weakness in corporate reputation, such as employee turnover, the need to discount market share despite good customer satisfaction scores, and difficulty in creating strategic alliances. A strong corporate reputation protects the value of a company even when that reputation is under assault.
2. Measure your overall corporate reputation
Corporate reputation should be measured using a composite index that incorporates the dimensions constituting corporate reputation. Dimensions should cover both the competency of an organisation (measured through product and service quality factors) and emotional appeal (such as favourability and trust). The index must also be demonstrably reliable (trackable) and valid (i.e. able to be linked to business outcomes). Simply measuring and reporting numbers is not enough.
3. Include company-specific diagnostic items
To manage reputation, corporate reputation surveys need to include items that can be analysed to identify key drivers. These must be meaningful to both the respondent and the company using the results. This is essential if the findings are to be actionable.
4. Identify the stakeholders that need to be included in your corporate reputation measurement program
Stakeholders often include investors/owners, employees, customers, suppliers, government representatives and community leaders. Although their relationship with the company may be internal or external, and their business influence direct or indirect, all can impact upon the success of the enterprise.
5. Plan for subsequent tracking waves
Be sure to plan for ongoing measurement before conducting the first baseline measure. A company’s reputation is subject to change, so periodic scheduled measurement sustains momentum and helps companies realise program potential.
6. Establish action plans
Corporate communications (or equivalent) and agency partners will need to work with senior management to prioritise reputation issues based on study results and develop action plans. These should include goals, objectives/performance targets, activities, timelines and responsibilities.